Global gold jewellery demand increases for the first time in four years, but the UK still suffers

A modest Q4 growth set the seal on a positive year for global jewellery demand, but the UK still remained troubled by Brexit concerns.

According to the World Gold Council’s full-year report for 2017, global demand for gold jewellery in 2017 increased by 4% to 2,135.5t – the first year of growth since 2013.

While India improved and the US market returned to growth, Europe saw a third consecutive annual decline in gold jewellery demand, with losses persistent throughout the year.

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The 3% drop in regional demand was largely due to weakness in the UK market, with the World Gold Council naming Brexit concerns as a reason for this.

The lower-end market was hit worst, with 9ct jewellery witnessing the largest losses.

Globally demand for gold jewellery gained momentum in the final quarter of 2017, growing 3% year on year to a 2-year high of 648.9t. A corresponding increase in full-year demand was primarily driven by recovery in India, the US and China.

Other highlights from the World Gold Council’s full-year report include a 7% decline in annual gold demand which was largely investment-related.

Gold demand rallied in the closing months of last year, gaining 6% year on year to 1,095.8t in Q4. However, it was too little too late, and overall full year demand fell to 4,071.7t.

In addition, ETF inflows, although positive, lagged begin 2016’s stellar growth; Central banks added 371.4t to global official gold reserves – 5% down on 2016’s net purchases; And bar and coin demand fell by 2% on a sharp drop in US retail investment.